The Week in impact investing: Contested terrain

TGIF, Agents of Impact! 

• Roundup: Caveat investors
• Podcast: Live-ish from Nairobi
• Spotlight: Combining human and artificial intelligence for youth mental health

🗣 Caveat investors. We’re looking forward to the editorial in Jeff Bezos’ Washington Post decrying President Donald Trump’s interference in free-market decision-making at Apple, where nearly 98% of shareholders this week rejected a proposal to “cease DEI” efforts at the company. That followed this week’s even more overwhelming rejection of a similar anti-diversity plank at Deere & Co., the farm equipment maker, and last month’s comparable result at Costco. Apple’s Tim Cook acknowledged the evolving legal landscape around diversity means “we may need to make some changes to comply.” To which the president responded, in all caps, that Apple “should get rid of DEI rules, not just make adjustments to them.” Freedom, as Bezos said in announcing the Post’s new editorial policy, “minimizes coercion.” The proxy advisor Institutional Shareholder Services cited Trump’s executive order in ditching its consideration of a board’s gender, racial or ethnic diversity in its recommendations around corporate board elections, despite evidence that such diversity correlates with improved performance. That represents “a clear abdication to political pressure at the expense of clients” and a possible breach of fiduciary duty, As You Sow’s Andrew Behar wrote in a guest post on ImpactAlpha. Mikaela Murekian of Bayes Business School offered five key performance indicators investors can use to “build inclusivity in a way that resonates globally.”

To get that global view, ImpactAlpha fanned out this week, including to the Foro Latinoamericano de Inversión de Impacto in Mérida, Mexico, and to Sankalp in Nairobi. As Dennis Price reported from the FLII, fund managers “flipped the pitch” on potential limited partner investors, grilling them on their strategies and priorities. As part of our expanded LP/GP coverage, now each Tuesday in The Brief, Jessica Pothering rounded up GPs who are delivering ownership investing strategies for LPs, big and small. Roodgally Senatus provided a glimpse of a new tool from Lafayette Square Institute that gives policymakers and investors granular data about how such strategies can advance economic mobility in every district and census tract. FAIRR’s Megan Waters suggested ways investors can prepare for the growing risks of bird flu. Despite the politicization of climate change and continued lack of liquidity in the market, more than two-thirds of climate-focused fund managers surveyed are looking forward to deploying more capital in opportunities in energy storage and distribution, advanced materials, agriculture and land restoration, as Amy Cortese reported.

The changing investment landscape is evident in Europe as well, where the European Union this week introduced measures to scale back its ambitious climate finance regulations, as Climate Proof’sLouie Woodall reported. The EU’s Sustainable Finance Disclosure Regulation is getting an update as well, says MesoFinance Media’s Bob Summers, who offered tips on how investors can help shape it. Impact investing also is due for an update, argued Brigit Helms of the Miller Center for Social Entrepreneurship, “moving beyond investor-centric models to financing that truly supports social enterprises and underrepresented entrepreneurs.” As such debates unfold, the language of investing has become contested terrain. In an essay last month, Ben Black, the likely new head of the US International Development Finance Corp. teamed up with tech mogul Joe Lonsdale to call for an end to USAID’s support for climate, gender and other equity initiatives. In the name of “pro-market” and “investor-driven” strategies, they call for DFC financing for American mining and shipping businesses in… Greenland. Like beauty, it seems, free markets, personal liberties and positive social impact are in the eyes of the beholders. – David Bank

The Week’s Podcast

🎧 This Week in Impact: Live-ish from Nairobi. Host Brian Walsh takes up ImpactAlpha’s top stories with editor Jessica Pothering, reporting from Nairobi. Up this week: Jessica digs in on food and agriculture in Kenya. Emerging fund managers in the ownership economy deliver returns to investors by sharing the wealth with workers, families and communities. And, what the EU Commission’s revamped rules mean for climate and sustainability disclosure.

• Listen to the new episode of This Week in Impact. Get the podcast in your feed by subscribing on Apple or Spotify.

The Week’s Deal Spotlight

AI-driven solutions to streamline mental health services for struggling youths. In healthcare, AI is starting to improve diagnostic accuracy, personalize treatments and support more efficient patient care delivery. Mental health care is a trickier proposition. Psychologists this month gave a presentation to federal regulators on the dangers of AI chatbots posing as therapists, citing several cases where teenagers have died. A new crop of mental health tech startups are combining AI tools with real-time oversight from psychologists, psychiatrists and other mental health care professionals to manage the risk of harmful and inappropriate responses. This week, Stanford, Calif.-based Sonar Mental Health raised $2.4 million in pre-seed financing for Sonny, its AI-powered “well-being companion” that provides mental health support to adolescents via text messages. Sonny was built and is managed with oversight from a board of psychiatrists, counselors and researchers. The chatbot is used by more than 4,500 students in nine US school districts to cope with stress during college applicants, grief and conflict. Sonar claims to help administrators improve early intervention for mental health crises and lower absenteeism in low-income and rural schools.

• Lived experience. Nearly half of adolescents in the US have had a mental health disorder, including anxiety, depression, post-traumatic stress and bipolar disorders. “Now more than ever, teens deserve to feel heard and seen, and educators deserve a scalable solution for delivering mental health support,” said Sonar’s Drew Barvir. Barvir lost his mother to suicide eight years ago, five years after he had lost a colleague to suicide. “I see it as my personal mission to prevent another family or friend from experiencing the tragedy of losing a loved one to mental illness,” he said. Sonar’s investors include Nina Capital, GSR Ventures, J4 Ventures and the Stanford Impact Founder Fellowships.  

• Healthy youth. Other youth mental health-focused startups that are using AI tools include San Francisco-based Little Otter, which this month raised $9.5 million to personalize whole-family mental healthcare plans. Carrie Walton Penner of Fiore Ventures called Little Otter’s ability to blend AI with human-centered care a  “game-changer.” Maryland-based Backpack Health, backed by Collab Capital, Hopelab, Rethink Education, Genius Build and other investors, offers an AI-based pediatric mental health teletherapy. BlackBird Health, based in Pittsburgh, uses AI to reduce trial and error in treating youth behavioral health issues. Also this week, Psyched Services secured a $300,000 low-interest loan for personalized mental health services in California schools, via a partnership between Mission Driven Finance and Elevance Health Foundation. Psyched’s team of psychologists provide one-on-one counseling, group therapy and specialized mental health for adolescents and the adults support them.
  
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The Week’s Talent and Jobs

💼 See and share more than a dozen new impact jobs posted this week on ImpactAlpha’s Career Hub and view hundreds of more jobs in impact investing and sustainable finance. Have a job listing to post? Submit it here.

Allie Burns plans to step down as CEO of Village Capital at the end of this year. Village Capital is on the hunt for a replacement… Sonen Capital added Judy Belk, former president and CEO of the California Wellness Foundation, and Holden Lee, former chief financial and investment officer of Tides, to its board of directors… Alliance Healthcare Foundation added Sydney Paige Thomas of Symphonic Capital to its impact investment committee. 

Radical Flexibility Fund welcomed Jorge Antonio de la Hoz Ramirez, a former director at Cube Ventures Accelerator, as a fund manager… Keith Kinch, co-founder of BlocPower, became interim operations director of Browning the Green Space, an inclusion-focused clean energy nonprofit… Virgilio Barco is stepping down as Acumen’s Latin America director to become ALIVE Ventures’ full-time managing partner… Accion Venture Lab brought on Akhil Gupta, previously with Knowl, as an India-based investment officer. 

Impact Seed appointed Chuck Berger, previously CEO of the Kimberley Development Commission, as executive director to lead its enterprise development and impact investment activities… The National Cooperative Bank welcomed Ramon Royster as a commercial loan portfolio manager, and Jay Sah as an IT business analyst… Schroders Capital Solutions named Vikram Bhandari, previously with BlackRock, as head and chief investment officer … S2G Investments welcomed Mary DaSilva, formerly with The Vistria Group, as chief people officer, and Kevin Vincent, previously with US Securities and Exchange Commission, as chief compliance officer.

Tyler Hartsock, formerly a partner with Peakview Capital, joined the Packard Foundation as managing director of venture capital and growth investments… Mika Kania, previously with the US Green Building Council, joined Cushman & Wakefield as head of sustainability advisory for Asia Pacific… Atta Impact Capital appointed Verne’s Alejandra Garcia, Corinne Lebrun of Impacta VC, and Mastersfund’s Gillian Muessig as board members.

That’s a wrap. Have a wonderful weekend. 

– Feb. 28, 2025